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The three cases came before the High Court today. Alamy Stock Photo
insolvency

Accountant given €5 million debt write-off in exchange for paying around €15,000

Two other cases before the High Court today involved €3.5 million in debts.

THE HIGH COURT has approved a number of unrelated Debt Settlement Arrangements (DSAs) allowing persons who got into financial difficulties to write-off millions of euro worth of unsecured debt mainly owed to financial firms.

Today, Mr Justice Alexander Owens approved a DSA allowing Co Louth-based chartered accountant Brian Carrig to write off over €5m in debts for a payment of approximately €15,000.

The court heard that Brian Carrig, a 51-year-old self-employed accountant from Ashfield, Drogheda in Co Louth, sought the DSA after a Dublin City-based pub business he was involved got into financial difficulties.

Keith Farry Bl, for Mr Carrig’s Personal Insolvency Practitioner (PIP) Eugene McDarby, told the court that the DSA is to be six months in duration, with the aim of returning Mr Carrig to solvency, with the creditors getting just 0.32% of what they are owed.

The arrangement is to be funded by a lump payment of €20,000, which to go towards his creditors and as payment to the PIP.

It has been funded with help from Mr Carrig’s family, the court heard.

Mr Carrig’s creditors included Everyday Finance, Cabot Finance as well as a trade creditor, the court heard.

Mr Carrig will also be forfeiting a lease he had for the premises where the pub business had operated from, counsel added.

Counsel said that none of Mr Carrig’s creditors had voted to either accept or reject the proposed DSA.

As a result of there being no objections to the proposal, counsel said there was nothing preventing the court from approving the DSA.

The judge also agreed to approve a DSA allowing a former building contractor to write off over €1.3m in debts for a payment of approximately €20,000.

Mr Farry, who acted for PIP Nicholas O’Dwyer for 56-year-old David Hoban of Captain’s Road, Crumlin, Dublin 12, said that the debtor had for a time run his own building company.

That firm had gone into liquidation as a result of the Covid-19 pandemic, with the effect of leaving Mr Hoban in financial difficulties, counsel added.

Mr Hoban’s creditors include financial funds Cabot Finance, Start Mortgages, Pepper Finance Corporation, and Permanent TSB.

Mr Hoban is currently unemployed and has no source of income, counsel said.

The DSA is to be paid over a period of 60 months and is aimed at returning Mr Hoban to solvency.

Counsel said that 81% of Mr Hoban’s creditors had voted to accept the arrangement, with only Pepper voting against the DSA.

In the third case to come before the court today, Mr Justice Owens approved an arrangement allowing a company’s IT director to write off €2.2m of debt for a payment of approximately €70,000 to his unsecured creditors.

The DSA was sought by 47-year-old Daniel Desmond from Drynam Hall, Swords in Co Dublin, who is a married man with two dependent children.

His creditors include Pepper Finance and AIB bank.

The lump sum DSA, which is aimed is to return the debtor to solvency, will be paid over a period of 12 months to the creditors and will cover the PIP’s costs.

Mr Farry, for Mr Desmond’s PIP John McCormack, said that the applicant got into financial difficulties in relation to repayments on loans he was repaying after he had spent some 12 months out of work.

Counsel told the court that Mr Desmond’s creditors will do better under the DSA compared to if the application was adjudicated a bankrupt.

In this case counsel said that 100% of the creditors had voted in favour of accepted the DSA, which is aimed at returning Mr Desmond to solvency, that had been put together by the PIP.

Author
Aodhan O Faolain